A city looks for big solutions in little – very little – houses

The 420 sq ft cottage in Karen Chapple's backyard boasts six "rooms". Photo: New Avenue.

On Saturday, Mayor Tom Bates will cut the ribbon on a new home on Delaware Street in Berkeley. It’s not every day a city leader takes the time to welcome a new dwelling into his fold, and this home is not big, nor particularly special; in fact it’s positively diminutive at just 420 sq ft, and can rightfully be described as a backyard cottage. So one might wonder why it warrants an “opening party” with dignitaries in attendance, sponsors — even a salsa band.

The reason is that small secondary units like this one — also known as in-law units, studios, or accessory buildings — represent a solution to a key challenge facing many cities: how to house a swelling population affordably without resorting to creating unsustainable suburban sprawl. “Smart growth”, in other words.

And Berkeley has decided to focus on these little houses. “We favor increasing the number of secondary units. It’s the only goal we have added to the housing element part of our general plan this year,” says Debra Sanderson, Planning Manager at the City of Berkeley.

The Delaware St cottage includes distinct areas for living, cooking, eating, working, bathing and sleeping. Photo: New Avenue.

These types of buildings often appeal to homeowners looking for more space without the need to relocate, or seeking rental income, and for home buyers looking for small, inexpensive urban homes on a permanent or semi-permanent basis.

The cute, zero-energy cottage at 934 Delaware Street was built by Berkeley start-up New Avenue, a company conceived at UC Berkeley which is where the cottage’s owner, Karen Chapple, also works.

It was while taking Dr. Ashok Gadgil’s Design for Sustainable Communities course at the Haas School of Business that Kevin Casey began to explore the idea of building a business around secondary units. He was spurred on by legislation in a number of states which decrees that most homeowners have the right to build a secondary unit on their property –and also by his student team’s own research.

“When we did a study of homes within half a mile of north Berkeley BART we found that 560 of the homes qualified for secondary units,” he said. Casey also figured out that almost the entire projected housing demand in California could be achieved by building accessory dwellings on existing properties. “That’s the point when I thought: this is a business,” he says.

Chapple became New Avenue’s first client when the student group came to see her at Cal — where she is Associate Professor of City & Regional Planning –to discuss their research. “I’ve always wanted to do one of these. I’m a New Yorker and I like density. When I look around Berkeley I  think it would look nicer with more buildings,” she says.

While Chapple concedes not every Berkeley resident would agree with her view — “there is a strong anti-growth contingent here,” she says — she sees backyard cottages as an exciting proposition in terms of a distributed housing model. “They are an asset-building strategy for Berkeley residents at the same time as a possible affordable housing strategy,” she says.

The cottage's loft sleeping area. Photo: New Avenue.

The Haas students used Chapple’s lot as a class project and it wasn’t long before she had refinanced her home to raise the $100,000 needed to build the sustainable cottage, the cost of which includes the zoning and building permits (see a breakdown of costs here). The house, which was designed by architect Mark Creedon, took three months to build and will run on solar power, will be used in a variety of ways: as a rental unit, to accommodate Chapple’s “constant stream of visitors”, and, if she has the luxury of not needing to use it for income, as an office.

Meanwhile, Sanderson is going to be examining ways to make it easier for more Berkeley residents to have their own little — or not so little — backyard pad (New Avenue has a number of different models on offer, some with two bedrooms, and double garage conversions can produce relatively spacious studios) . “We favor them because they address a number of social problems,” says Sanderson — “such as providing for ageing relatives and keeping communities stable and diverse.” She adds: “They also allow housing on a smaller scale in transit corridors.”

While zoning ordinances mean most homeowners have the right to build a secondary unit in Berkeley, they do need to meet pre-set criteria to qualify, including having one parking space, a minimum lot size and certain set-back requirements. One reason Berkeley has many illegal secondary units is that it’s not always easy to check all the boxes. Working with Chapple’s UC department, Sanderson plans to scrutinize each element of the process. “We are considering what we can change to facilitate the process,” she says.

Roll on tiny houses of the future.

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  • Jerome Taylor

    Used to be we called this infilling. Not very new, just dropped by the city in favor of projects that gave them a lot of money.

    What about rent control and eviction control? Once you rent out the cottage you can’t use it for your guests. No mention of this primary limiting factor on adding second units in Berkeley.

  • Eric Panzer

    The fact that once a cottage is rented you can’t use it for guests would apply irrespective of Berkeley’s rent and eviction controls. It’s not as if a homeowner in Modesto could turn out the tenant of an in-law unit so a guest could stay in it for a week.

    Also, rent control does not apply to new construction, so that’s not really an issue for new infill. If anything, it’s the burden of the permitting process and the sure-bet NIMBY opposition that stymies in-law unit construction. The minimum required parking, in addition to being anti-environmental, likely also has a chilling effect. And, to be fair, there are probably more than a few Berkeley homeowners who simply like their backyards more than they would like the rent from an additional unit.

  • Victoria

    Big fan of the little dwelling concept..would work really well also to use the similar style mobile home units to create a little village inside Sausalito’s Marinship, which is already zoned for a trailer park.

  • Melanie

    Looks pretty nice, at least with the flattering lighting. And lighting’s an all-important factor in small space: plenty of sunlight, along with sufficiently high ceilings that one doesn’t feel closed in and easy access to a garden and/or patio. Such limited space in an apartment building could feel claustrophobic, but the sense of having indoor AND outdoor space seems to make this cottagette work.

  • Jerome Taylor

    If the unit is totally new construction and not alteration or replacement of a structure that was once lived in it is exempt from rent but not eviction controls. Upgrading an illegal unit to code does not count as new. Also the single family dwelling that the cottage is behind is now subject to rent control if it is ever rented. If the city would exempt owner occupied duplexes and triplexes from all controls a lot of great units would come on the market and in many cases come back on the market. Large apartment buildings and corporate landlords would still be controlled. Having a unit on your property that you can never regain control of can make an empty backyard look rather attractive.

  • savingracesarah

    These clever homes would be a solution for homeless folk. Everyone needs and wants a place of one’s own.
    Why don’t these concept small homes get into places like Haiti?

  • Backyard living has been typical of Berkeley for a very long time. My father built garages with an apartment on top behind our house on Grant Street around 1943.

  • Alex Nowik

    I think that the requirement to provide parking is something that now seems outdated.

  • Frank Nachtman

    So I went to check out the house. I was a bit dismayed in the difference between the marketing materials and reality. The pamphlet said “starting at $60,000” but the house actually cost around $100,000. The pamphlet said $20,000-30,000 rental income per year, which seems preposterous based on rental prices in West Berkeley. Maybe $15,000 is more reasonable?

    If anyone knows about a greener, more modern looking pre-fab option that would be more in the $60,0000 range I’d love to hear about it.

  • EBGuy

    The Clayton i-house (www.claytonihouse.com) goes for around $88k (including delivery). That’s for 1bed/1bath (723 sq.ft.) Green extras like bamboo floors, tankless water heater, etc. cost more, plus foundation and site prep. Modern design, but not to everyone’s taste (YMMV).

  • Thank you all for coming to the open house – we had almost 500 people there.

    To address Frank’s point – Houses start at $60,000 for a small studio that is similar to this home (but the finishes are a bit less fancy) and they range up to $160,000 for a three bedroom.

    Rents in the Bay Area are that high. You are right that a studio like this rents for $15,000 per year ($1,250 per month). But renting a two bedroom is easily over $1,800 per month. especially if you go to the Peninsula where the tenant has two private parking spaces and a private yard. And while Berkeley is our home, we go anywhere there are jobs and people and a need for small homes.

    We’re here to explain all the differences and ways to go about creating a small home or backyard cottage, contact us at info@newavenuehomes.com if you would like to discuss.

  • laura menard


    Blu homes is opening a west coast office.


  • Name Withheld


    Wow, thanks for the link!
    I love the look of the 1/1 Clayton i-House. It’s very similar to something I’m thinking about building in my backyard. Great to see more companies designing things like this.

  • Janet Byron

    The zoning is a big issue. If your lot is smaller than 4,500 square feet you can not convert or build an ADU. Mine is about 4,050 square feet; I have an underutilized garage that I would love to convert and rent out. I think few if any exceptions are allowed to this rule.

  • Name Withheld

    @ Janet — The zoning seems a bit unfair. While the property at 934 Delaware is listed at 5,000 square feet, the main building takes up a large majority (3/4?) of the lot. Despite the large-ish lot, the size of the main building doesn’t leave a lot of space for the secondary unit, which seems to be the reason Berkeley won’t allow secondary units on smaller lots in the first place…


    I hate to advocate illegal activity, but converting your garage under the table and renting it out to students may be the only way you can get some use out of that space. Talking to some building inspector friends of mine, it seems that this sort of things is becoming more and more common these days.

    I’m blessed enough to have a very large lot and would love to build a secondary unit, but the endless horror stories about nightmare tenants in Berkeley – and my experiences living in the same building as some nightmare tenants when I was a renter – have spooked me enough that I won’t consider it until something changes.

  • Gina

    This is not a new concept at all but it is still very cool. Tiny Texas Houses has been doing these houses for about ten years in Texas. He builds his houses with almost all recycled material from old homes and farm houses. They are great and have so much character.
    If you Google them you can see the homes he has built.They start from 40k and go up to about 100k. They are very cute and unique looking.


  • Name Withheld

    “The Haas students used Chapple’s lot as a class project and it wasn’t long before she had refinanced her home to raise the $100,000 needed to build the sustainable cottage, the cost of which includes the zoning and building permits (see a breakdown of costs here).”


    The link to the cost breakdown is broken.

  • Dr. Little

    Legalizing homes under 1,000 square feet in size is long overdue, and they certainly do not have to be as luxe as this (beautiful) small home. If you visit one of my fave links, http://tinyhouseblog.com -it will lead you to a vast array of builders for the array of incomes we are talking about for people who need a secure, safe roof over their head.

    I especially like what Victoria has to say about places zoned for a Trailer Park. Certainly in places as creative and forward thinking as the Bay Area, we can sustain existing neighborhoods, adding infill where it works not just as neighborhood associations allow, having trailer parks for those who desire to live in a trailer park – and within the same sort of code- create new scenarios where it would be small home parks. The small home movement is burgeoning and for many it is because of a desire to not carry a mortgage on space we don’t need nor want. If I only had a PLACE to put a small home, I could have one this year and be set for life with home ownership and no massive/impossible mortgage. Unless you have known poverty and sporadic homelessness you just can’t imagine what a great and overwhelming desire drives someone like me to owning my own home; knowing that an ‘average’ home is beyond my reach -as is every home even those inside our Bay Area’s criminal hotbeds- you can never imagine how utterly crushing this is to my spirit.

    That it’s illegal in the Bay Area still astonishes me when Los Angeles already has altered their Small Lot City Ordinance, and in Reno there’s Habae Rae (?) building small homes very, very successfully and in places like Oregon and Washington: spreading like wildflowers.

    Above all, it is my desire to see that as some shift inevitably happens positively toward the small homes’ legality, that the poor aren’t left out in the cold as is common. One of the most difficult aspects of being a low income person is always being at the mercy of a landlord, or neighbors who can makes one’s life unbearable -and on and on. There are quality small homes being made for $12,000… healthy green homes, not ones that are off-gassing and have roofs that lose their quality in a decade.

    I think the New Avenue homes are beautiful & I have a lot of respect for them, especially the way they handle their lofts/storage, but I have no desire for such a family sized kitchen -and more. Should I say -and less. I desire no fancy interiors, just solidity: I’d rather spend that money on an off-grid solar set up so that my small footprint is as little a resemblance to the huge one’s around it.

    Berkeley could be instrumental in changing green, private and small housing here in the Bay Area for people of all incomes. Berkeley could be a blazing pioneer -again- this time in creating new laws that enable low income people to finally get off the tight rope of anxiety/fear & worry – and into a small home: with ownership, the only chance we will ever have. If you got this far, I truly thank you for your time.

  • BJ

    BJ from RWS looking for you and M.P.T.  contact at piachien@gmail.com.  hi from Karl

  • That is one of the best arguments I read so far. We need to give people more power over their own living circumstances as long as it doesn’t pose a public health or safety concern.